What Does Fiduciary Mean?

What Does Fiduciary Mean?

August 11, 2023

By Melinda Gustafson Gervasi

Without fail, when explaining a Wisconsin Power of Attorney for Finances document to a client, I point out the last page.  It requires the signature of the primary and secondary agents appointed by the principal.  In simple terms, the first and second person my client appointed to handle their financial matters if they were alive but too sick to act, needs to sign-off of being a fiduciary.  "What exactly is a fiduciary?" many clients ask.

According to Dictionary.com, a fiduciary is a person to whom property or power is entrusted for the benefit of another.  Building on that basis, the Consumer Financial Protection Bureau states that a Fiduciary is someone who manages money or property for someone else.  A key concept is that they are managing the money for someone; it is not their own money.  How is this implemented you might wonder.  Keep the following in mind if you have been asked to be a fiduciary:

1. Keep Records -- note any and all monies you collected (paycheck, disability insurance, settlement from a personal injury case, tax refund, etc) as well as details on all money you spend (mortgage or rent, medical bills, utility payments, insurance premiums, tax liabilities, etc).  If it were me, I would track everything to the penny and have documentation for each transaction.
2. Separation of Funds -- this is NOT the money or property of the fiduciary, they are simply managing another person's assets.  Do not comingle funds with your own. 
3. Proceed With Caution -- double and triple check bills you pay and forms you complete.  If you are acting as a Financial Power of Attorney it means someone has had a health crisis and cannot act.  The last thing a person with a health crisis needs is a financial crisis.  Do not be afraid to retain professional help, such as a CPA or financial planner.
4. Act in the Best Interest -- it is key that you act in the best interest of the person who is sick.  What serves them the best, not what serves your needs.

When talking with my clients about who to name as a Power of Attorney for Finance I quip "you need a person who is going to be wise, not someone who will take your money to Vegas and put it all on red".

Image by M. Gustafson Gervasi, 2023

Remember that a blog is not an attorney.  It is a platform to spark thought and discussion.  If you enjoy this post, consider becoming a Follower of this blog.  Click the Follow button in the upper right hand corner and enter your email.  You will receive a notice when a new post hits.  Thank you for reading, be well.

Estate Planning & Probate for the Bibliophile

Estate Planning & Probate for the Bibliophile

August 4, 2023

By Melinda Gustafson Gervasi

Bibliophile -- is an adjective that should be included in any online profile I write for myself.   Some people have a "to read" pile of books on the nightstand.  I have a "to read" book shelf.  As a young child I remember summer days spent organizing and reorganizing my book collection.  It has been a lifelong trait since my mother first started buying me Golden Books as a toddler.   Now, as I approach the 50 year milestone, my book collection is extensive.  

My love of books and reading was a significant influence in my decision to enter law school and engage in the practice of law.  After nearly twenty years of handling estate planning and probate cases, I am acutely aware of the fact that one day someone (my husband, my kids, or my banker) will need to figure out what to do with all of those books I accumulated.  Apparently I am not the only reader to ponder this question.  At the end of 2022 Karen Heller wrote about the heartbreak bibliophiles face when having to face purging their books.  Her piece appeared in the Washington Post.  I agree with the sentiments presented -- someone will need to sort through the stacks and re-home the material.  Obvious paths include:

• Gifting -- during your lifetime can you gift the book to a specific person who would enjoy the piece?
• Selling -- generate some income by selling collections to second hand shops, antique dealers, or on Ebay.
• Little Free Libraries -- fill up your neighbors Little Free Library and let a local enjoy the book.
• Public Libraries -- donate to public libraries, who sell donations to support library operations.
• Charity Thrift Stores -- drop off books at thrift stores that support your favorite non-profit.
• Recycle -- explore how you can recycle outdated books with your city or local municipality (for local readers of my blog, check out WM, a recycling center)

A reader and a writer, image of author's 2013 self-published book.

Did I miss another option for your books?  Leave a comment and share the knowledge!  Thank you for reading.  Remember, a blog is not legal advice, but rather a platform to generate thought and discussion.  Share this post with others who might benefit.  Be well, and enjoy National Book Lovers Day, August 9, 2023.